Small Cap Feast

Small Cap Feast – 08 January 2019

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Main Market (Specialist Funds)

The Global Sustainability Trust -aiming for attractive risk-adjusted returns by investing primarily in private market investments that are expected to have a positive environmental and social impact raising c.£200m. Due 31 Jan 2019.


Greenfields Petroleum (TSX-V:GNF)  production focused company with operated assets in Azerbaijan seeking AIM dual listing including $60m private placement. Mkt cap $12.6m CAD. Expected late January 2019.

Breakfast Buffet

Gateley (GTLY.L) 140p £145m

Gateley, the law-led professional services group, announced its unaudited results for the six months ended 31 Oct 2018.

Revenue up 20.1% to £46.4m (H1 18: £38.6m), 10.2% from organic growth

Adjusted EBITDA up 24.8% to £6.6m (H1 18: £5.3m)

PBT up 18.6% to £5m (H1 18: £4.2m)

Robust balance sheet with net assets up 40.8% to £23.1m (H1 18: £16.4m), with net debt increased to £8.2m (H1 18: £7.1m)

Strong cash generation as cash conversion up 2.5ppts to 87.4% (H1 18: 85.3%)

Basic EPS up 13.5% to 3.52p (H1 18: 3.10p)

Profit after tax up 18%, supporting increase in interim dividend of 18.2% to 2.6p per ordinary share (H1 18: 2.2p)

Strong performance across the business demonstrating the success of our strategy, the strength and sustainability of our business model and further enhancing Gateley’s reputation for delivering growth from its established, resilient and progressive business.


Joules (JOUL.L) 256p £214.62m

Joules, the premium British lifestyle brand, updated on the Christmas trading performance of its retail business for the seven-week period to 6 Jan 2019.

The Joules brand continued to perform well over the festive trading period with retail sales increasing by 11.7% against the prior year on a comparable basis. This performance reflected growth across all of the brand’s product categories.

Joules delivered a particularly strong performance online with E-commerce representing almost half of total retail sales during the Period.  This was driven by a good performance through Joules’ own digital channels as well as through concession partners’ websites and reflects the appeal of the Joules brand as well as the strength of the Group’s integrated and flexible ‘total retail’ model.

Retail performance during the Period supports the Board’s previously stated confidence in the Group achieving full year 2019 PBT in line with its expectations.


Volga Gas (VGAS.L) 51.5p £41.5m

Volga Gas, the oil and gas exploration and production group operating in the Volga Region of Russia, announced its average production volumes for Dec 2018 and for the FY2018.

In Dec 2018, average gas processing capacity utilisation decreased by 4% compared to Nov 2018. A minor decrease was caused with few low temperature disruptions.

The average production in Dec 2018 was 5,803 barrels of oil equivalent per day (4% lower than Nov 2018).

Actual production for the year to 31 Dec 2018 of 5,144 is marginally ahead of management’s expectations of 5,000 boe per day including LPG volumes.

Production data is based on preliminary monthly production reports prepared for the purposes of submissions to tax authorities for Mineral Extraction Tax purposes.


Sopheon (SPE.L) 1,330p £126m

Sopheon, the international provider of software, expertise, and best practices for enterprise innovation management solutions, announced that it is partnering with global confectioner The Hershey Company (NYSE:HSY) to support digital transformation of Hershey’s product innovation portfolios.

As consumer packaged goods (“CPG”) business process experts, Sopheon will help The Hershey Company integrate knowledge discovery, insights and learning for better understanding and decision making in response to business opportunities and challenges. Accolade will connect existing and new processes to enable cross-functional work to identify and take action on portfolio growth priorities.


4D pharma (DDDD.L) 115p £76.79m

4D pharma, a pharmaceutical company leading the development of Live Biotherapeutics, announced the appointment of Ed Baracchini, PhD, and Professor Axel Glasmacher, MD, as independent NEDs with immediate effect.

Ed Baracchini, PhD, was previously the Chief Business Officer at Xencor Inc. where he led strategic alliances and licensing.  During his time at Xencor he negotiated license agreements with Novartis ($2.6bn: immune-oncology bispecific antibodies), Novo Nordisk ($600m: drug discovery collaboration), Amgen ($500m: option and development agreement autoimmune disease antibody) among numerous others. Prior to that he served as SVP Business Development for Metabasis Therapeutics.

Professor Dr. Axel Glasmacher was until recently Senior VP and Head of the Global Clinical Research and Development Hematology-Oncology at Celgene, where he has worked in various roles for more than ten years.  His work at Celgene led to the approvals of Revlimid®, Idhifa®, and Vidaza® (haematological cancers).  He also worked on the PD-L1 inhibitor durvalumab. Prior to Celgene, Professor Glasmacher worked within the fields of hematology-oncology at the University Hospital in Bonn.


Codemasters (CDM.L) 179p £226.1m

Codemasters, the award winning British video game developer and publisher specialising in high quality racing games, announced that it has entered into a joint development agreement with NetEase, Inc. (NASDAQ: NTES), one of China’s leading internet and online game services providers, to develop a new mobile game for the global market.

Under the terms of the Agreement, NetEase shall commit an internal mobile development team, apply its proven knowledge of mobile game design, and take on all operational and publishing activities globally with regard to the Game. Codemasters shall provide assistance with its proprietary technology, resources and existing game assets.

Pursuant to the Agreement, Codemasters will receive a minimum of $8m in revenue over the next three years, commencing with an expected $4m within the current financial year ending 31 Mar 2019. Codemasters’ total lifetime revenue from this Agreement shall be dependent upon sales performance as profit generated by the game, following recoupment by NetEase of the aforementioned $8m, shall be shared between the parties. Based on these terms, Codemasters’ Board of Directors now expects its Adjusted EBITDA for the year ending 31 Mar 2019 to be ahead of expectations.


Red Emperor Resources (RMP.L) 3.3p £13.27m

The Board of Red Emperor Resources, announced an oversubscribed placing to certain new and existing institutional and sophisticated investors of 100,000,000 new ordinary shares of no par value each in the capital of the Company at an issue price of 2.8p (AUD0.05) per share to raise £2.8m (c.AUD5.0m) before expenses.

The Placing utilises the Company’s existing share capital authorities and is conditional on admission of the Placing Shares to trading on AIM. Following admission, the Placing Shares will represent, in aggregate, approximately 19.04% of the Company’s enlarged issued share capital.

The net proceeds from the Placing will be used to augment the Company’s general working capital and provide contingency, as the Company prepares for the upcoming drilling of the Winx-1 exploration well and potential appraisal activities in the Alaska North Slope, where the Company has a 31.5% working interest. The Winx prospect is a 3D seismic defined conventional oil prospect in the successful Nanushuk play fairway with a gross mean un-risked prospective resource of 400 MMbbls (126MMbbls net to Red Emperor) and is adjacent to the Horseshoe 1/1A discovery well drilled by the Armstrong/Repsol JV in 2017. Refer to the Company’s announcement of 25 June 2018 for further details.


Kingswood Holdings (KWG.L) 12.5p £19.75m

Kingswood Holdings, the integrated wealth management group, which trades under the name KW Wealth, announced that Patrick Goulding has joined the Board as Group FD.

Patrick will head Kingswood’s finance function as well as overseeing the Group’s operations. He is a Chartered Accountant with more than 25 years of experience in the global financial services industry in both a financial and operational capacity. His experience has included senior roles at Morgan Stanley, Lend Lease, ING and Schroders in the US, Australia and Europe.

He joins from Ardmore Partners, an independent consultancy he founded in 2016, to provide strategic advice and tactical support to investments managers, service providers and investors seeking to enhance their business platforms and capabilities. From 2014 to 2015, he was CFO of Global Net Lease Inc, a NYSE listed real estate company. Prior to this he was a MD in Morgan Stanley’s global real estate investment business, serving as Global Head of Real Estate Finance & Portfolio Management.


Osirium Technologies (OSI.L) 125p £16.6m

Osirium Technologies, a leading vendor of cloud-based cybersecurity software, announced a contract win with the UK arm of a Fortune 500 multinational integrated oil and gas company.  The contract will run over 3 years covering software and professional services.

The Group has appointed Osirium to deliver its full PxM platform offering Privileged Account Management, Privileged Task Management and Privileged Session Management modules and associated consultancy services, initially supporting 400 devices.

Two operational issues are driving the initial stages of this project.  The first is the clear ability to demonstrate GDPR and Sarbanes Oxley compliance.  The second is the need to automate privileged access into the network infrastructure, allowing a more secure approach to managing common privileged tasks on switches and firewalls.


StatPro Group (SOG.L) 117p £73.3m

StatPro Group, the provider of cloud-based portfolio analytics and asset pricing services for the global asset management industry, has secured a three-year contract extension with a large UK investment manager for its Revolution Delta service, with a minimum contract value of £2.35m.

“The investment manager uses Revolution Delta to manage multi-asset risk and fixed income investments. The precision of the fixed income pricing as well as the broad functionality of the service make Revolution Delta the ideal solution for their front office.

“This significant contract extension underlines the quality of the Revolution Delta product for customers operating in the fixed income markets and is a confirmation of our capability to provide Revolution Delta clients continuity of service from within our Revolution platform.”


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Derren Nathan
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